Paris – Global oil demand has dropped for three straight months as COVID-19 cases have risen in Asia but it is expected to bounce back next month, the International Energy Agency (IEA) said on Tuesday.
Demand fell from July after rebounding the previous month, with major crude consumer China leading the decline, the IEA said in a monthly report.
‘Global oil demand remains under pressure from the virulent COVID-19 Delta variant in key consuming regions, especially in parts of Asia,’ the report said.
Demand fell by 310,000 barrels per day (bpd) on average over the three months to September.
But it is expected to recover in October with an increase of 1.6mn bpd and continue to rise until the end of the year, said the IEA, which advises developed countries on energy policy.
‘The latest news on the COVID front is more optimistic, with global cases falling in recent weeks, continued progress in vaccine manufacturing and inoculations, and less restrictive social distancing measures in many countries,’ it said.
Global oil demand is expected to rise by 5.2mn bpd this year, slightly lower than previously forecast, but 2022 growth will be slightly higher at 3.2mn bpd, according to the report.
The IEA said Hurricane Ida ‘wreaked havoc on the key US Gulf Coast oil producing region’ in late August and is ‘still causing problems for US and global markets’.
Offshore installations and refineries have been slow to restart, forcing massive draws of stocks of both crude and products in key markets, it said.
‘It is only by early 2022 that supply will be high enough to allow oil stocks to be replenished,’ the IEA said.
The OPEC said on Monday that it expects global oil demand to exceed its pre-pandemic level next year thanks to the rollout of vaccines and the economic recovery. The forecast came as OPEC+ is beginning to raise output to meet recovering demand.